In March 2009, Hyundai started offering low-rate loans on three car brands, in addition to cash-back incentives. Dave Zuchowski, vice president of sales for Hyundai Motor America, told Automotive News, “We’re looking for [Hyundai] Assurance to drive traffic and then the new rebates to help close the deals” (“Hyundai Piles On Incentives,” March 9, 2009).
Another way brands can practice value building is to promote exclusivity and offer consumers something of unique value for a limited time. The recent introduction of the 70th Anniversary Platinum Edition of the Disney movie Pinocchio typifies the category. This specially-packaged edition includes the remastered original movie in both DVD and Blu-ray formats, with lots of bonus material for which Disney is known.
The Pinocchio release is just the latest in a series of Disney Platinum Editions—part of a larger value-building strategy by Disney to release original movies from the “Disney vault” for limited time periods, thus increasing their perceived value. Disney released the first classic movie, Snow White, on DVD in 2001, but it wasn’t until the 50th Anniversary Platinum Edition of Sleeping Beauty was released last year that Disney added Blu-ray to its Platinum Editions.
Disney is already one of the world’s most recognized brands, so why do they need to issue Platinum Editions? Because Platinum Editions reinforce the image of the brand. Once the limited-release time period is over, the Platinum Edition movies are no longer available through traditional retail channels—they become “out of print” collector’s editions—and the Disney brand maintains its aura of exclusivity.
A third path to value building is more conventional but just as effective: using add-ons that enhance the value of a brand and reinforce the brand purchase decision. Apple’s iPhone stands out in this area. While it was a legitimate breakthrough brand in its own right, the iPhone was high priced and, by some standards, a risky and unproven technology. Apple rapidly overcame those early objections by opening up the iPhone to developers. The result was an iPhone “App Store” with thousands of applications for the iPhone, some of them free. In March 2008, more than 100,000 developers had downloaded the iPhone Software Development Kit in a period of just four days. By the end of 2008, Apple had recorded over 100 million application downloads.
However, some recent data suggests the interest in iPhone applications is much higher than the usage. Over 30 million downloads from Apple’s App Store were analyzed, showing that less than a third of individuals purchasing the applications use them the day after purchase (“Most iPhone apps spurned after purchase,” CNET, February 23, 2009). Less than 5 percent of those who have downloaded an application are using it after 20 days, according to CNET.
Still, Apple succeeded in demonstrating that it was once again a pioneering technology brand, and that the iPhone was an added-value platform—one that could provide a mind-numbing quantity of applications unlike any other communications device on the market.
It’s important to point out that value building needn’t be as comprehensive as Hyundai Assurance, as exclusive as Disney’s Platinum Editions or as wide-ranging as iPhone’s applications. Look at this uncomplicated value-building example: Bank of America’s Keep the Change program.
While every other bank was essentially offering the same kind of checking and savings accounts, with a few minor variations here and there, Bank of America made one little move to differentiate itself from its competitors. The bank offered to do the following for customers who opened a combined checking-savings account: “Each time you buy something with your Bank of America Check Card, we'll round your purchase to the nearest dollar amount and transfer the difference from your checking account to your savings account. You get to keep the change and grow your savings.”
This is a very simple way to build a little extra value into Bank of America’s checking and savings products—potentially attracting new customers who might begin a relationship with the bank that could lead to the use of other products and services.
Hyundai, Disney, Apple and Bank of America are representative of big name brands that don’t take their status for granted. These brand marketers know that value building is an important means of keeping their brands fit—and creating strong bonds with customers who are seeking the best value…especially in these economic times.